EDUCATION

How Has COVID-19 Affected The Cryptocurrency Market?

Joel Mark Harris
Content Writer

April 8th, 2020

The spread of the COVID-19 virus has made it a turbulent time for everyone. Major markets have dipped, supply chains have halted, and millions of people have lost their jobs. Both fiat currencies (traditional currencies like the Canadian dollar) and cryptocurrencies have not been able to avoid the storm. 

For a simple comparison, on February 12th, Bitcoin traders were pushing for a high of US$11,000 in the longest surge since June. By March 12th, Bitcoin dropped to a low of $3,775. 

Other cryptocurrencies like Ethereum, XRP, Bitcoin Cash all dropped significantly as well from their February highs.

This marked a new Black Thursday, where the crypto market, along with the rest of the economy, crashed on March 12th due to the COVID-19 pandemic. 

But at the time of writing, Bitcoin has rebounded to nearly US$7,000. And with Bitcoin halving in May of this year, Bitcoin could catapult back up.

So there is light at the end of the tunnel. Bitcoin is now making a healthy comeback because the U.S signed off on trillion dollar stimulus packages and showed a willingness to print an infinite amount of money in the hopes of stabilizing the economy.

This is one of the reasons why Bitcoin was created. To be a hedge against unlimited fiat printing. According to many crypto experts and enthusiasts, one of Bitcoin’s main objectives is to counter the notion that money creation can be inexhaustible. And it’s this search for an alternative system that gets some people very excited about crypto.

Is It A Good Time To Buy Cryptocurrency?

This dip in the price of crypto is seen as a bargain buy to many. What had previously cost US$11,000 to buy 1 BTC now only costs US$7,000 (at time of writing) – a 36% discount so to speak.

Some people think of these lower prices as lowering the barrier to entry, but the barrier is already low considering you can buy fractions of a cryptocurrency (you don’t have to buy a whole Bitcoin).

But perhaps the lower price makes it less daunting for a new investor, as you get more crypto for your money. All in all though, this could be a great chance for investors to enter the market, add to their existing holdings or simply reload. 

If you’ve been toying with the idea of getting started with crypto, now may be a great time to start dipping your toes in. $100 now would buy you more Bitcoin than it would have a month ago!

If you’re not feeling quite ready yet, that’s alright too. Many do choose to stay put during times of uncertainty – and play a wait-and-see game. 

But it’s safe to say that the interest and curiosity is definitely there. 

Baidu, one of China’s key search engines, saw searches for Bitcoin increase by 183% over the past thirty days. Google Trends also shows a jump in searches across Canada and the U.S., with numbers peaking for both countries on March 13th.

This is clearly curiosity spurred on by the massive drop on March 12th, although queries around buying cryptocurrency are consistently higher than those related to selling.

If you’re thinking about buying or selling crypto in Canada, you may want to consider opening a Netcoins account.  You can make any trades you want with speed, efficiency and ease for investors of all levels of experience. Got questions? Get answers in minutes during business hours over LiveChat, phone or email.